Analysts Forecast 1.5 For Pound to Dollar (GBP/USD) Exchange Rate

November 25, 2014 - Written by John Cameron

STORY LINK Analysts Forecast 1.5 For Pound to Dollar (GBP/USD) Exchange Rate

Our Latest Pound to US Dollar (GBP/USD) Exchange Rate Forecast

Not for the first time during recent months, a strong set of US data provoked as pronounced drop in global appetite for risk during this afternoon’s trading session.

The Pound to Australian Dollar exchange rate is +0.86 pct higher with a conversion rate of 1 GBP equals 1.84086 AUD.
The Pound to Canadian Dollar exchange rate converts -0.22 per cent lower at 1 GBP is 1.76830 CAD.
The Pound to Euro conversion rate is -0.26 pct lower at 1.25929 GBP/EUR.
The Pound to New Zealand Dollar exchange rate today is converting +0.69 per cent higher at 2.01150 GBP/NZD.
The Pound to US Dollar exchange rate converts +0.06 per cent higher at 1 GBP is 1.57080 USD.

US GDP Data Scares Investors

The closely-watched American Gross Domestic Product data for the three months leading up to the end of September, revealed that the world’s premier economy is expanding at a healthy rate of knots. With economic growth unexpectedly climbing to close to an annualised 4.0%, things are certainly looking up in the States.

VIX Spikes on Fed Forecast

However, the markets took the news as a sure-fire sign that interest rates will be on the way up in the US, perhaps as soon as the early part of next year. The mere suggestion that the Federal Reserve will be tightening its monetary policy was enough to cause investors to run for cover, as evidenced by movement for the VIX ‘Fear Index’. The gauge of pessimism amongst Chicago equity traders dipped to 12.42 in early trading, but following the release of the US GDP stats, it quickly rose to an intraday high of 12.99, representing a forward move of the best part of 5%.

Australian Dollar and NZ Dollar Exchange Rates Drop

Meanwhile, the Commodity Dollars gave up ground in the currency markets, sending the Pound Australian Dollar exchange rate up to as high as 1.8442 GBP AUD and the Pound Sterling New Zealand Dollar exchange rate up to 2.0166 GBP NZD. Analysts forecast that the move may be a short-lived knee jerk reaction to the American figures and point out that last week’s Federal Reserve minutes maintained that US interest rates will remain low for a ‘considerable time’.

Low Inflation Forecast Hampers Pound Sterling Exchange rate Today

Meanwhile, Bank of England Governor Mark Carney once again confirmed that he believes there is a strong chance that the headline CPI measure of UK inflation will dip below the 1.0% threshold within the next six months. His reiteration of this view confirms the disparity between the Federal Reserve and the Bank of England on monetary policy, leading analysts to predict that the Pound US Dollar exchange rate may pull back towards the 1.5000 threshold in the near-term.

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TAGS: American Dollar Forecasts Australian Dollar Forecasts Currency Predi Forecasts